The economics and politics of instability, empire, and energy, with a focus on Latin America and the Caribbean, plus other random blather and my wonderful wonderful wife. And I’d like a cigar right now.

January 13, 2012

Revolution update: not much has changed

There was a time when this blog gave Hugo Chávez some credit. I wrote that he was building a pretty effective political machine; I went so far as to call it “Daleyismo,” after the way this guy ran Chicago. I also gave him credit for raising domestic non-oil tax collection. And when the electricity shortages broke out, I pointed out that Chavista policy hadn’t been a complete failure: there had been a lot of investment in generation, but the country was hit by a really terrible drought.

Sadly, it looks as though the Bolivarian Republic isn’t following through even on its successes. The electricity piece, for example, praised the country’s investment in generation capacity, but lambasted the Bolivarian Republic for letting the transmission grid fall apart and encouraging massive wastage. Not a whole lot has changed: Venezuela has brought a lot of new thermal generation capacity on-line, but blackouts continue. Even more embarrassing, Venezuela has been unable to raise natural gas production, forcing it import gas from Colombia, gas produced by one of the oil companies that the Bolivarian Republic is fighting at ICSID. (As Setty reports, the problem was that Venezuela insisted on paying low prices for domestic gas.)

Housing doesn’t look much better. There’s a conflict over how many houses were built in 2011, but the statistics through the third quarter of 2011 don’t look that encouraging:

And, of course, the tax reforms have gone nowhere. Estimated non-oil tax collection will be 12.4% and 12.8% of GDP in 2011 and 2012, respectively, about what it was in 2008.